Computing the Break$-$Even Point for a Multi$-$Product Company  

 

Wiseman Inc. $($a privately held company$)$ markets two fitness products:

$1)$ Hero Plank Machine

$2)$ Makeover

A contribution margin income statement for a recent month for the two games appears as follows:

Hero Plank Makeover Total

Sales $ $55,000$ $ $95,000$ $ $150,000$

Less: Variable expenses $40,00065,000105,000$

Contribution margin $ $?$ $ $?$ $$?$

Less: Fixed expenses $36,000$

Net income $ $?$

$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$

REQUIRED:

$1.$ Calculate the Contribution margin & Net Income for

Hero Plank $\_\_\_\_\_\_\_\_\_\_\_\_$

Makeover $\_\_\_\_\_\_\_\_\_\_\_\_$

Total Contribution margin $\_\_\_\_\_\_\_\_\_\_\_\_$

Net Income $\_\_\_\_\_\_\_\_\_\_\_\_$

$2.$ Compute the overall Contribution Margin Ratio for Wiseman Inc.

Write down the Formula for the CM Ratio and show calculated CM Ratio.

$3.$ Compute the overall break$-$even point for the company in sales dollars for Wiseman Inc.

Write down the Formula for Break$-$Even and show the calculated break$-$even point in $

Answer rating: 100% (QA)

To calculate the contribution margin and net income for each product as well as the overall contribu... View the full answer